Erich's Trades for Wednesday, August 17, 2005
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Market Update for Wednesday, August 17, 2005
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"I am a slow walker, but I never walk backwards." - Abraham Lincoln
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1: CURRENCIES
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September Australian Dollar ADU5
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Interesting...the AD found support at 7640, right near the trendline. If we get a bounce here tomorrow I *might* consider a buy.
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September British Pound BPU5
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I know I'll probably regret this but since the Pound is so oversold I'll hold off an see if the market breaks the support at 180.25...let's hope so, so we can buy at a better price.
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September Canadian Dollar CDU5
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We got our wish as rates declined enough to bring the 8350 resistance line into play. It might be a little premature, but I'll look to buy a break of today's high and cover under 8350.
*BUY September Canadian Dollar at 8373
*Stop 8347
*Approximate Risk Exposure: $260 per contract
*Profit Target: 8495
*Approximate Profit Potential: $1220 per contract
*RRR: 4 1/2:1
*Degree of Risk: Moderate to HIGH
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September EuroFX ECU5
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Got lots of money to play with? Good, cus you're going to need it if you plan on trading the RSI bounce in the Euro tomorrow.
*BUY September EuroFX at 124.07
*Stop 123.57
*Approximate Risk Exposure: $625 per contract
*Profit Target: 126.93
*Approximate Profit Potential: $3575 per contract
*RRR: 5 1/2:1
*Degree of Risk: HIGH
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September Japanese Yen JYU5
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Looks like the Yen is about to enter pullback mode. Expect a day or two of lower rates before we look to buy again.
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September Mexican Peso MPU5
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The Peso can not seem to overcome the 94.000 resistance barrier. Notice today's extremely small session AND the RSI bounce. Lower rates are coming tomorrow, I can almost guarantee it and while I thought about getting more agressive on a sell, I'll stick with original numbers.
*SELL September Mexican Peso at 92.775
*Stop 93.275
*Approximate Risk Exposure: $250 per contract
*Profit Target: 89.775
*Approximate Profit Potential: $1500 per contract
*RRR: 6:1
*Degree of Risk: Low to Moderate
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September Swiss Franc SFU5
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Not quite to the RSI test just yet; however today's session definitely "felt" support. A slightly more palatable version of the Euro trade...but not by much.
*BUY September Swiss Franc at 8017
*Stop 7977
*Approximate Risk Exposure: $500 per contract
*Profit Target: 8227
*Approximate Profit Potential: $2625 per contract
*RRR: 5:1
*Degree of Risk: HIGH
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September US Dollar Index DXU5
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Officially in pullback mode now, and we could look at selling short tomorrow; however I'll wait one more day to see if we can't get better numbers to work with.
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2: ENERGIES
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October Unleaded Gas HUU5
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Will you look at that? A double hit on 190.30! We will likely see a reversal here tomorrow, but a break above will get me long again. This market is extremely overbought and you get a nose bleed at these heights, but there's no denying the strength of this trend!
*BUY October Unleaded Gas at 190.55
*Stop 189.45
*Approximate Risk Exposure: $462 per contract
*Profit Target: 198.45
*Approximate Profit Potential: $3318 per contract
*RRR: 7:1
*Degree of Risk: HIGH
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October Heating Oil HOV5
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Like Unleaded Gas, I would like to see prices retrace a little more; however we need to be ready for the eventual resumption of the trend. As enticing as the potential profits are here, you need to be very careful as the energies can be extremely unforgiving.
*BUY October Heating Oil at 194.25
*Stop 192.90
*Approximate Risk Exposure: $567r contract
*Profit Target: 204.85
*Approximate Profit Potential: $4452 contract
*RRR: 7 1/2
*Degree of Risk: HIGH
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October Crude Oil CLV5
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Ditto for Crude, but again we need to be ready for the trend to continue.
*BUY October Crude at 6805
*Stop 6765
*Approximate Risk Exposure: $400 per contract
*Profit Target: 6995
*Approximate Profit Potential: $1900 per contract
*RRR: 4 1/2:1
*Degree of Risk: HIGH
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3: FINANCIALS/INDICES
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June (06) Eurodollar EDM6
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The ED tested the 9560 resistance today as we hoped. I've got a lot more confidence in our sell order now, whether or not the market fills the order is beside the point, but if we do get filled we should be on the right side of the trade.
*SELL June (06) Eurodollar at 95.505
*Stop 95.575
*Approximate Risk Exposure: $175 per contract
*Profit Target: 95.245
*Approximate Profit Potential: $650 per contract
*RRR: 3 1/2:1
*Degree of Risk: Moderate
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September mini-DOW YMU5
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Likely to follow the S&P lower tomorrow, but nothing I see worth trading.
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September mini-NAS NQU5
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Looks like this index is bound to slip some more as we get closer to the weaker fall months. Is it time to pay the Piper for all those rallies?
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September mini-S&P esU5
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The S&P backed off resistance in a big way today, but that's okay since our order to buy was never filled. Probably see the slide continue tomorrow.
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4: GRAINS
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September Corn CU5
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Corn is trading near weekly support which could cause a bounce tomorrow. That would be okay though as it would give us another chance to short this market.
Maybe this time we won't get gapped.
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September Oats OU5
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Smallish session in Oats today. Still looking for another chance to sell here as well.
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September Rice RRU5
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Nice day in the Rice pits as the market easily found our buy order and rallied enough that we can bring stops to breakeven for tomorrow. First profit target is 713.5.
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September Soybean Meal SMU5
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Well we got the support hiccup we were looking for today. The only thing that bothers me (you knew there had to be something didn't you?) is how close we are to the 62% retracement. Sometimes this translates into a bigger bounce and would give us a better selling price.
I'll hold off one more day and keep my fingers crossed the market doesn't run away from us.
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December Soybean Oil BOz5
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Ditto for Bean Oil. Crossing my toes too.
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September Soybean SU5
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Double ditto for Beans. Crossing my eyes.
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September Wheat WU5
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Not fair! Not fair! Did you see what wheat did today? That's not right! We had this market dead-to-rights and it backed up and found our stops...just barely too!
I'm going to find a wheat farmer and beat him up tomorrow for this!
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5: MEATS
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October Feeder Cattle FCV5
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Anybody have any idea what Feeder's are up to? Yeah, me neither.
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October Live Cattle LCV5
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There's Cattle, fishing around the support line, looking for orders. Fortunately ours was well below the market and I'll run it again tomorrow. Hopefully the only way prices can get this low is if there is serious downside momentum, which we might not get until after Friday's Cattle report is released.
*SELL October Live Cattle at 7917
*Stop 7967
*Approximate Risk Exposure: $200 per contract
*Profit Target: 7637
*Approximate Profit Potential: $1120 per contract
*RRR: 5 1/2:1
*Degree of Risk: Moderate to HIGH
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October Lean Hogs LHV5
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We lost much of our upside potential in this trade with yesterday's big move. I'd like to buy but the resistance at 6220 is cramping my style.
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6: METALS
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September Copper HGU5
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Copper got very close to finding our first profit target today coming up a few ticks short however. It might be a good idea to bring those stops up just under the 170.50 line as a reversal (short term) looks likely tomorrow.
Don't want to give back all our hard earned profits do we?
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December Gold GCZ5
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Gold is poised to resume the trend on renewed weakness in the US buck. I'll look to buy the market above the very strong resistance at 452 and try and trade it to a rounded bottom formation.
*BUY December Gold at 452.7
*Stop 448.7
*Approximate Risk Exposure: $400 per contract
*Profit Target: 469.3
*Approximate Profit Potential: $1660 per contract
*RRR: 4:1
*Degree of Risk: Moderate to HIGH
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September Silver SIU5
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Silver doesn't give me the same warm 'n fuzzy feeling as gold does at the moment, so I think I'll pass.
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7: SOFTS
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September Cocoa CCU5
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Cocoa is fighting monster long term support right now so if you're still short this market bring stops in above today's high to protect profit in case we see a bounce.
This support also gives us another chance to sell this market if prices continue lower. Ideally I'd like to see a bit of a pullback, but just in case...
*SELL September Cocoa at 1327
*Stop 1347
*Approximate Risk Exposure: $200 per contract
*Profit Target: 1207
*Approximate Profit Potential: $1200 per contract
*RRR: 6:1
*Degree of Risk: HIGH
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September Coffee KCU5
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If we can get coffee to give us one more pullback day then we'll look at selling it again. I'm just a little too chicken to try it after yesterday's huge move.
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December Cotton CTZ5
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We might have squeezed cotton a little too hard as the market found our exit stops today. It was a nice run though with a little over $1500 in profit per contract.
Standing aside for tomorrow, but now that we're flat I'd love another pullback day like today.
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September OJ OJU5
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OJ continues to shy away from our sell order, but that's okay. RSI is heading higher and I fully expect prices to follow, but I'll stick with the sell order for one more day.
*SELL September OJ at 8985
*Stop 9165
*Approximate Risk Exposure: $270 per contract
*Profit Target: 8385
*Approximate Profit Potential: $900 per contract
*RRR: 3:1
*Degree of Risk: Moderate to HIGH
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October Sugar SBV5
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Sugar continued lower today allowing us to bring in our stops to breakeven. There's a little more than $100 in accumulated profit per contract, so adjust your stops accordingly if breakeven is not enough for you.
First profit target is support at 931.
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